The Biden-Ryan debate was marked by some spirited claims that didn’t always match the facts.
Ryan said Obama’s proposal to let tax rates rise for high-income individuals would “tax about 53 percent of small-business income.” Wrong. Ryan is counting giant hedge funds and thousands of other multimillion-dollar enterprises as “small” businesses.
Biden exaggerated when he said House Republicans cut funding for embassy security by $300 million. The amount approved for fiscal year 2012 was $264 million less than requested, and covers construction and maintenance, not just security.
Ryan was wrong when he said a rise in the jobless rate in Biden’s hometown was “how it’s going all around America.” The rate nationally has sunk back to where it was when Obama took office. And in Ryan’s hometown, it’s more than 4 percentage points lower that it was at the start of Obama’s term.
Biden seemed to question Ryan’s assertion that administration officials called Syrian President Bashar Assad “a reformer” even when he was killing his own civilian countrymen. Ryan was right. Early in the bloody Syrian uprising Hillary Clinton called Assad a “different leader” who many in Congress believe is “a reformer.”
Ryan claimed the Obama administration spent stimulus money on “electric cars in Finland.” Not true. Although the cars have been assembled in Finland, the money went for work in the United States.
Biden quoted Romney as saying that he would not “move heaven and earth” to get Osama bin Laden. What Romney said was that he’d go after other terrorists as well.
Ryan misquoted a Medicare official as saying “one out of six hospitals and nursing homes are going to go out of business” as a result of the Affordable Care Act. Not quite. The official said that many could become “unprofitable,” and the the situation could be monitored to head off bad outcomes.
Ryan claimed that the ACA contains “taxpayer funding” of abortion. In fact the law provides no direct funding of abortion except in cases of rape or incest or to save the mother’s life. And it’s a matter of interpretation whether subsidized private insurance would amount to indirect federal support for abortion.
Ryan was off base when he said of a cost-saving panel created by the Affordable Care Act, “not one of them even has to have medical training.” Actually, the board must include physicians and other health care professionals among its members.
Ryan at one point ground out a collection of shopworn misstatements about the health care law that we’ve had to rebut time and again, claiming “20 million people … are projected to lose their health insurance” (not true), that premiums have gone up $3,000 (no, they haven’t) and that 7.4 million seniors “are going to lose” Medicare Advantage plans (maybe, but they’d still be covered by traditional Medicare).
Page 2 of 10 - And both Biden and Ryan continued to twist the facts about Romney’s tax plan. Biden again misrepresented the findings of the nonpartisan Tax Policy Center, and Ryan repeated a misleading claim that “six studies have verified” that the plan is mathematically possible.
The debate between Vice President Joe Biden and Rep. Paul Ryan, the Republican nominee for vice president, was held Oct. 11 at the Norton Center for the Arts at Centre College, in Danville, Ky.
Biden and Ryan sparred over the effect of Obama’s proposed tax policies on small business and job creation.
Ryan: This one tax would actually tax about 53 percent of small-business income. It’s expected to cost us 710,000 jobs.
Biden: Let me tell you who some of those other small businesses are: hedge funds that make $600 million, $800 million a year. That’s — that’s what they count as small businesses, because they’re pass-through.
This is a mixed bag. Ryan is exaggerating the extent to which higher individual tax rates would fall on small-business owners. He’s including in his estimate a lot of income from some very large businesses.
Republicans have been using and distorting this figure for years. It goes back to a 2010 study by the nonpartisan Joint Committee on Taxation, which examined the amount of business income — not necessarily “small” business income — that is taxed at individual rates through what are called “pass-through” entities, such as partnerships and “S” corporations. And the JCT was quite clear in warning that literally thousands of these businesses are in fact multimillion-dollar enterprises.
Joint Committee on Taxation: These figures for net positive business income do not imply that all of the income is from entities that might be considered “small.” For example, in 2005, 12,862 S corporations and 6,658 partnerships had receipts on more than $50 million.
So Biden was right on that point. A $600-million-a-year hedge fund would indeed qualify as a “small business” by Ryan’s misleading definition.
But Ryan also has at least some support for his claim that 710,000 fewer jobs would result from allowing the top individual federal income-tax rates to rise to pre-Bush levels on high-income individuals, as Obama proposes. That was the conclusion of a study released in July by Ernst & Young. It said its economic forecasting model projected — compared with what might otherwise happen over the long run — “a loss of roughly 710,000 jobs.”
On the other hand, the study was commissioned by pro-business groups including the U.S. Chamber of Commerce and the National Federation of Independent Business, which lean strongly Republican. And the study contained an important qualifier: It said this job loss would result “when the revenue is used to finance higher government spending.” It did not examine what would happen if the higher revenues were simply applied to reduce future federal deficits. Moody’s chief economist, Mark Zandi, called that omission “odd” and said, “It seems to me that is the more relevant scenario. And my sense is that if they did, the results would be very different.”
Page 3 of 10 - Biden’s Libya Claims
Biden claimed that Ryan “cut embassy security in his budget $300 million below what we asked for.” That’s an exaggeration. The fiscal year 2012 funding was $264 million less than the administration had requested, and the funding isn’t only for security. It covers construction and maintenance as well.
Biden: Number one, the — this lecture on embassy security — the congressman here cut embassy security in his budget by $300 million below what we asked for, number one.
The Obama administration requested $1.801 billion for embassy security, construction and maintenance for the fiscal year that ended Sept. 30, according to The Hill newspaper. And House Republicans came back with a proposal to cut spending to $1.425 billion. Ultimately, the Republican-controlled House agreed to increase funding to $1.537 billion after negotiations with the Senate.
Biden also claimed that the administration wasn’t aware of security concerns among U.S. officials in Libya before the attack on the consulate in Benghazi that killed four Americans. The vice president said: “[W]e weren’t told they wanted more security there. We did not know they wanted more security again.”
We can’t say whether requests for more security — which were denied — reached the top. But American officials who worked in Libya over the summer placed the blame on a deputy assistant secretary of state — not top administration officials — when testifying before Congress this week.
Eric Nordstrom, the top regional security officer in Libya over the summer, said: “All of us at post were in sync that we wanted these resources.”
Andrew Wood, a Utah National Guardsman who was leading a security team, testified: ”We felt great frustration that those requests were ignored or just never met.”
They placed the blame squarely on Charlene Lamb, deputy assistant secretary of state for international programs, according to Foreign Policy magazine.
Ryan rapped Biden for the unemployment rate in Biden’s hometown of Scranton, Pa., but Ryan was wrong when he said, “that’s how it’s going all around America.”
Ryan: Joe and I are from similar towns. He’s from Scranton, Pennsylvania. I’m from Janesville, Wisconsin. You know what the unemployment rate in Scranton is today?
Biden: I sure do.
Ryan: It’s 10 percent. You know what it was the day you guys came in — 8.5 percent. That’s how it’s going all around America.
Biden: You don’t read the statistics. That’s not how it’s going. It’s going down.
Ryan correctly cited the unemployment statistics for Scranton, Pa. The city’s unemployment ratewas, in fact, 8.5 percent in January 2009, and it was 10 percent in August. But Ryan was incorrect when he said, “That’s how it’s going all around America.” In fact, the unemployment rate nationwide is now exactly the same as it was when Obama took office – 7.8 percent (and as Biden said, has been going down — slowly and at times fitfully – since it hit a peak of 10 percent in October 2009). In other words, for every town like Scranton that has seen its unemployment rise, there are others that have seen a decline. In fact, Ryan’s hometown of Janesville, Wis. — which Ryan mentioned immediately before Scranton — has seen its unemployment rate drop from 13.5 percent in January 2009 to 9.2 percent in August.
Page 4 of 10 - Who Called Bashar Assad ‘a Reformer’?
Ryan repeatedly criticized the Obama administration for calling Syrian President Bashar Assad “a reformer when he’s killing his own civilians.” At one point, Biden tried to interrupt Ryan to ask who had done so.
So, who’s right? Ryan.
Secretary of State Hillary Clinton in a March 27, 2011, interview on “Face the Nation” explained why the U.S. would intervene in Libya, but not Syria — despite a recent attack by Syrian police on civilians. At the time, there were reports that as many as 20 Syrian civilians had been killed. Clinton called Assad a “different leader” who many in Congress believe is “a reformer.”
Clinton, March 27, 2011: There is a different leader in Syria now. Many of the members of Congress of both parties who have gone to Syria in recent months have said they believe he’s a reformer. What’s been happening there the last few weeks is– is deeply concerning. But there’s a difference between calling out aircraft and indiscriminately strafing and bombing your own cities, than police actions, which frankly have exceeded the use of force that any of us would want to see.
Two days later, Clinton walked back that comment a little during a press conference in London. Asked if the administration viewed Assad as a “reformer,” Clinton said: “I referenced opinions of others. That was not speaking either for myself or for the administration.”
She also said that the administration would be “waiting and watching” to see if Assad implements reforms.
“So we’re troubled by what we hear, but we’re also going to continue to urge that the promise of reform, which has been made over and over again and which you reported on just a few months ago — ‘I’m a reformer, I’m going to reform,’ and I’ve talked to members of Congress and others about that, that we hear from the highest levels of leadership in Syria — will actually be turned into reality,” she said. “That’s what we’re waiting and watching for.”
Stimulus Money for Electric Cars in Finland?
Ryan ridiculed Biden for the economic stimulus championed by President Barack Obama, charging that some of the money was spent overseas on “electric cars in Finland.” But while all of the Fisker Automotive cars to date have been manufactured in Finland, the money loaned to Fisker through the stimulus was spent on support services in the U.S.
Ryan: Was it a good idea to spend taxpayer dollars on electric cars in Finland, or on windmills in China?
We last wrote about this when a similar claim was made in an ad from the conservative Americans for Prosperity back in May.
Ryan is talking about $529 million in stimulus-backed loans awarded to Fisker Automotive. It’s true that all of the cars made by Fisker to date were assembled by a contract manufacturer in Finland. But that doesn’t mean any of the stimulus money was spent there.
Page 5 of 10 - In fact, all of the first round of government loans to Fisker — $169 million in loan guarantees — went toward design, engineering, sales and marketing work done in the U.S., according to Fisker officials.
“All of the DOE loan money that we got for the Karma project [the first line of cars] had to be spent in America,” Fisker spokesman Roger Ormisher told us back in May.
A second round of stimulus funding — $359 million worth of loans– was awarded to develop a second, less costly line of cars to be manufactured in a shuttered GM facility in Delaware. Those plans have been delayed, and the government has since cut off Fisker’s access to further stimulus loans. So far, Fisker has drawn down $193 million of the $529 million in loans from the U.S. Department of Energy.
Earlier this month, Fisker CEO Tony Posawatz said during an Automotive Press Association luncheon in Detroit that Fisker still wants to build the vehicle at a plant in Delaware, the Detroit Free Press reported. Whether that comes together remains to be seen. But Ryan’s suggestion that any of that stimulus money went to Finland is simply inaccurate.
On Moving ‘Heaven and Earth’ to Get Bin Laden
Biden quoted Romney as saying that he would not “move heaven and earth” to get Osama bin Laden. Actually, Romney said Bin Laden wasn’t the only one he would go after, and that the country should have “an effective strategy to defeat global, violent Jihad” rather than “just trying to catch one person.”
Biden: He said, “I wouldn’t move heaven and earth to get bin Laden.” He didn’t understand it was more than about taking a murderer off the battlefield. It was about restoring America’s heart and letting terrorists around the world know, if you do harm to America, we will track you to the gates of hell if need be.
We first fact-checked Biden when he quoted Romney’s “heaven and earth” comment during his speech at the Democratic convention.
A transcript of Romney’s interview with the Associated Press in April 2007 — when Bin Laden was still alive — shows there was more to Romney’s position than Biden lets on.
[AP reporter ] Liz Sidoti: Why haven’t we caught Bin Laden in your opinion?
Romney: I think, I wouldn’t want to over-concentrate on Bin Laden. He’s one of many, many people who are involved in this global Jihadist effort.
He’s by no means the only leader. It’s a very diverse group – Hamas, Hezbollah, al-Qaeda, Muslim Brotherhood and of course different names throughout the world.
It’s not worth moving heaven and earth and spending billions of dollars just trying to catch one person. It is worth fashioning and executing an effective strategy to defeat global, violent Jihad and I have a plan for doing that.
Page 6 of 10 - Hospitals ‘Going out of Business’
Ryan said that the actuary of the Centers for Medicare and Medicaid Services “came to Congress and said one out of six hospitals and nursing homes are going to go out of business” as a result of the federal health care law. But that’s not what the actuary said.
Medicare’s chief actuary, Richard Foster, has said that his office’s economic simulations “suggest that roughly 15 percent of Part A providers [which include hospitals, skilled nursing facilities, hospices and home health care providers] would become unprofitable within the 10-year projection period as a result of the productivity adjustments” in Medicare payment rates. That could lead some providers to “end their participation in the program,” he said.
But becoming “unprofitable” isn’t the same thing as “going to go out of business.” And Foster added that “this policy could be monitored over time to avoid such an outcome.”
Also worth noting is that the budget Ryan proposed, and House Republicans adopted, contains the same reductions in the future growth of Medicare Part A spending as the Affordable Care Act. The only difference is that the savings would be applied differently. So a hospital that would “go out of business” because of the ACA would be just as likely to close its doors under Ryan’s budget. Mitt Romney has rejected those Medicare reductions, but Ryan is being inconsistent, to say the least, when he criticizes the administration on that point.
Taxpayer-Funding of Abortions?
Ryan said that there was “taxpayer funding” of abortion “in Obamacare.” There’s no direct funding allowed, but it’s a matter of interpretation whether federal dollars will be supporting abortion indirectly.
The Affordable Care Act provides no direct federal funding of abortion, except in cases of rape, incest or to save the life of the mother. Those are the same rules that have applied for many years to Medicaid coverage.
Furthermore, even when it comes to low-income workers who will be buying their own private insurance with the help of federal subsidies, the law requires that any premium dollars that could go toward abortion coverage must come from their own pockets, not from taxpayers.
But this is a contentious issue. The separation of federal money and what individuals pay out of their own pockets for premiums wasn’t a satisfactory compromise for either side in the abortion debate. NARAL Pro-Choice America refused to endorse the final bill, saying it had “egregious” restrictions on abortion coverage, while the National Right to Life Committee said that the separation of federal and private dollars was just a gimmick, and in practice the law “will result in federal subsidies for private insurance plans that cover abortion.”
For more on this issue, see our April 2010 Ask FactCheck, “The Abortion Issue.”
Page 7 of 10 - Bureaucrats and ‘Death Panels’
Ryan and Biden both overreached when talking about the Affordable Care Act’s 15-member Independent Payment Advisory Board. Ryan falsely claimed the board will decide “what, if, when, where” future seniors get Medicare, and that the board will lead to “denied care for current seniors.” But Biden went too far when he equated Ryan’s statement with the far more egregious claims about the IPAB made by Sarah Palin in August 2009.
Ryan: And then they put this new Obamacare board in charge of cutting Medicare each and every year in ways that will lead to denied care for current seniors. This board, by the way, it’s 15 people, the president’s supposed to appoint them next year. And not one of them even has to have medical training. …
We would rather have 50 million future seniors determine how their Medicare is delivered to them instead of 15 bureaucrats deciding what, if, when, where they get it.
This claim has been repeated throughout the 2012 campaign, as we’ve reported multiple times. But, in fact, the law specifically forbids rationing or restriction of benefits, and the board is quite limited in the scope of the binding, cost-saving recommendations it is allowed to make.
According to the text of the Affordable Care Act, the board can’t restrict benefits or eligibility, increase premiums or taxes, or “ration” health care. And a Kaiser Family Foundation analysis saidthat the IPAB would be effectively restricted to finding savings from “Medicare Advantage, the Part D prescription drug program, skilled nursing facility, home health, dialysis, ambulance and ambulatory surgical center services, and durable medical equipment.”
Ryan is also wrong to claim that “not one of [the board members] even has to have medical training.” As we’ve pointed out many times, the law says the members must include national health care experts, physicians and other health care professionals, economists, and representatives of consumers and seniors.
But Biden went a bit too far when he associated Ryan’s claims with those of Palin.
Biden: You know, I heard that death panel argument from Sarah Palin. It seems every vice presidential debate I hear this kind of stuff about panels.
To be clear, Palin did not use the phrase “death panel” until August 2009, almost a year after hervice presidential debate with Biden. On her Facebook page, Palin said: “The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama’s ‘death panel’ so his bureaucrats can decide, based on a subjective judgment of their ‘level of productivity in society,’ whether they are worthy of health care.”
Ryan did not use the words “death panel,” and he never claimed that the board would be making decisions about seniors’ Medicare on an individual basis, as Palin did. Biden exaggerated when he equated the two claims.
Page 8 of 10 - Health Care Hooey
Ryan rattled off several false and misleading claims about the Affordable Care Act, greatly overstating the law’s effect on premiums and the likely impact on the number of Americans with work-based coverage.
Ryan: Look at all the string of broken promises. If you like your health care plan, you can keep it. Try telling that to the 20 million people who are projected to lose their health insurance if Obamacare goes through or the … 7.4 million seniors who are going to lose it. … Or remember when he said health insurance premiums will go down $2,500 per family, per year? They’ve gone up $3,000, and they’re expected to go up another $2,400.
Ryan was wrong when he said premiums had “gone up $3,000? because of the health care law. First, the average premium for a family work-based policy has gone up $1,975 between 2010 and 2012, and the average single policy has gone up $566, according to an annual survey of employer plans by the Kaiser Family Foundation and Health Research & Educational Trust. On the campaign trail, Romney has claimed premiums have gone up by $2,500, but that’s still too high.
Second, that’s the total increase, paid by employers and employees combined. And both the 2011and 2012 reports said that the amount and percentage paid by employees hadn’t changed much, if at all. And third, when we looked into this issue a year ago, experts told us the federal health care law was responsible for a 1 percent to 3 percent increase because of more generous coverage requirements. The total increase from 2010 to 2011 was 9 percent, most of which was due to rising medical costs. In the past year, however, the average family premium went up just 4 percent. In a press release on the premium survey, the president of Health Research & Educational Trust saidthat “[p]remium growth is at historic lows, which greatly benefits workers.”
Ryan also exaggerated with the claim that “20 million people … are projected to lose their health insurance if Obamacare goes through.” That comes from a nonpartisan Congressional Budget Office analysis that actually said it was likely that 3 million to 5 million would no longer get insurance through their employers, with some of those individuals dropping their insurance voluntarily to “instead choose to obtain coverage from another source.” Ryan’s 20 million figure came from a pessimistic scenario that the March 2012 report said relied on extreme assumptions. An optimistic scenario found that the number on work-based coverage would increase by 3 million.
The claim that 7.4 million seniors would lose their coverage refers to an estimate of the number that would normally be expected to take a Medicare Advantage plan but would instead chose traditional Medicare in 2017. Medicare Advantage plans, offered by private insurers, have been paid more on average than traditional fee-for-service Medicare, 9 percent more in 2010. The health care law reduces those extra payments over time to bring Medicare Advantage payments in line with traditional Medicare. As a result, those plans could shed extra benefits that they now offer seniors — so they are expected to attract fewer seniors. The chief actuary of the Centers for Medicare & Medicaid Services estimated a 50 percent lower enrollment — from 14.8 million seniors to 7.4 million — in 2017, compared with what would have happened without the law.
Page 9 of 10 - As of 2011, there were 11.5 million seniors on Medicare Advantage, an increase of about 500,000 from 2010. So, the 7.4 million is a projection of the number of seniors, who normally would have been expected to take Medicare Advantage, but who will stick with traditional Medicare as a result of the law. It’s not an estimate of the number “who are going to lose” their health care plan, as Ryan said.
Tired Tax Claims
Biden falsely claimed that Romney has “another tax cut coming” that “will, in fact, give … $250,000 a year” to millionaires and “raise taxes” on middle-income families by $2,000 a year. That’s not true. Biden is citing the work of a nonpartisan group that has said the Obama campaign has misinterpreted its study.
For his part, Ryan claimed that “six studies have verified” that Romney’s tax plan is mathematically possible — that it can reduce income tax rates by 20 percent across the board and offset the loss of revenues by reducing or eliminating tax deductions without benefiting the wealthy or increasing the deficit. But Ryan inflates the number of “studies” by including blog items and the work of campaign advisers.
Biden: They’re holding hostage the middle class tax cut to the super wealthy. And on top of that, they’ve got another tax cut coming that’s $5 trillion that all of the studies point out will in fact give another $250 million — yeah, $250,000 a year to those 120,000 families and raise taxes for people who are middle income with a child by $2,000 a year.
Biden is referring to an August study by the nonpartisan Tax Policy Center. It’s true that the report (page 19) calculates that those in the top 0.1 percent of taxpayers would receive a $246,652 net tax break. It also says on page six that “taxpayers with children who make less than $200,000 would pay, on average, $2,000 more in taxes.”
But it is not a study of Romney’s plan. It is an exercise in trying to determine if a “revenue-neutral individual income tax change that incorporates the features Governor Romney proposed” could be revenue neutral without benefiting the wealthy.
TPC Director Donald Marron disagrees with Biden’s interpretation of the study.
“I don’t interpret this as evidence that Governor Romney wants to increase taxes on the middle class in order to cut taxes for the rich, as an Obama campaign ad claimed,” Marron wrote. “Instead, I view it as showing that his plan can’t accomplish all his stated objectives. One can charitably view his plan as a combination of political signaling and the opening offer in what would, if he gets elected, become a negotiation.”
Ryan seeks to discredit the Tax Policy Center’s study by claiming, falsely, that six studies prove Romney’s tax plan can accomplish all of its goals.
Page 10 of 10 - We wrote about this before when Romney and Ryan referred to “five different studies.” At that time, we wrote that one of those “studies” was a blog item (not a study), one was a campaign white paper coauthored by Romney’s chief economic adviser, and one was a newspaper op-ed written by yet another campaign adviser who later updated his calculations in a blog item. Romney and Ryan counted the updated blog item as a “study.”
The fifth study was written by Harvey Rosen, a Princeton economics professor who once served as chairman of President George W. Bush’s Council of Economic Advisers. Rosen assumes Romney’s tax plan would add an extra 3 percent to the economy — an assumption that Rosen calls “reasonable.” But Romney’s plan is designed to be revenue neutral, so it would not reduce the tax burden on the economy and, presumably, would have less of a growth effect. Bush’s large tax cuts in 2001 and 2003, for example, did reduce the overall tax burden and yet the year-to-year changes to the real GDP were just over 2 percent.
The latest study cited by the Romney campaign comes from Alex Brill, a research fellow at the conservative, pro-business American Enterprise Institute. Among Brill’s assumptions: Romney could raise revenue by taxing the interest income from state and local bonds and the investment income of life insurance contracts. Both are currently not subject to federal taxes. But, as the Washington Post points out, “taxing interest on state and local bonds or on the value in life insurance policies, for example, would violate Romney’s preference for preserving low taxes on savings and investment.”
William Gale, a coauthor of the Tax Policy Center’s study, told the Post that Brill proves his point: that Romney’s plan cannot be accomplished unless “you give up on some of the goals.”
– by Brooks Jackson, Eugene Kiely, Lori Robertson, Robert Farley, D’Angelo Gore, Ben Finley and Jesse DuBois